Specialty Crops: 2007 Farm Bill Issues

Congress is expected shortly to begin consideration of omnibus legislation to replace the expiring Farm Security and Rural Investment Act of 2002 (P.L. 107-171, the 2002 farm bill). Farm bill policies governing U.S. Department of Agriculture (USDA) programs on marketing, crop insurance and disaster assistance, protection against pests and diseases, export promotion, and domestic food assistance, among others, are important to the competitiveness of the specialty crop sector of U.S. agriculture. The sector includes fruit, vegetable, tree nut, and nursery crop producers, processors, manufacturers, wholesalers, importers, and exporters.

Although specialty crops are not eligible for direct support under USDA's farm commodity price and income support programs, the policies that Congress sets for the major farm income and commodity price support programs affect them. Congress inserted a provision in the 1996 farm bill (P.L. 104-127, the Federal Agriculture Improvement and Reform Act) permitting program participants to plant different crops on their program acres and still receive benefits. Before final passage of that bill, however, Congress added another provision largely restricting participants from planting fruits and vegetables on those acres, after specialty crop interests expressed concern over the price volatility that the sector could suffer as a result. Congress renewed the planting restriction in the 2002 farm bill.

The upcoming farm bill debate on the planting restriction provision, as well as other key policies, will be affected by several new factors. Trade agreement concerns could potentially require a relaxation of planting restrictions, and constrain policies affecting the amount of spending for program crops. In addition, the specialty crop sector is seeking greater federal investment in non-trade distorting programs that would support its role as a high-value segment of U.S. agriculture. As an initial effort in that regard, the 108th Congress passed the Specialty Crops Competitiveness Act of 2004 (P.L. 108-465). Among other things, the act authorized block grants to states for research and promotion efforts, strengthened efforts to overcome phytosanitary (pest and disease) barriers to exports, and provided mandatory funding for a large competitive research grant program to address a broad spectrum of specialty crop development needs.

This report discusses potential 2007 farm bill proposals affecting the specialty crop sector, as foreshadowed by the Specialty Crops Competitiveness Act of 2004 as introduced (H.R. 3242), and by a variety of proposals introduced in the 109th Congress (H.R. 3562/S. 1556; S. 2487; H.R. 6193). The report will track congressional consideration of the 2007 farm bill and will be updated as necessary.